The fun factor is definitely important! Remember that guitar can actually be pretty painful at first. And kids are not always known for taking the long view of things.
Depending on their motivation, if the instant gratification isn't so instant or gratifying, they can get discouraged.
I used to teach guitar to kids. Many of the moms were very serious; they wanted sight reading, music theory etc. as part of the instruction, and that's what I offered. Guitar not just as guitar, but as a gateway to the whole world of music.
But I always set aside time to teach something that the student really wanted to learn, too. Something that they chose, something fun. Whether it was a favorite pop song, or blues riff, or some cool picking/strumming pattern. The sense of empowerment (I hate
that word) was important and made a big difference.